As bitcoin soared toward its $35,000 short-term price target, losing altitude at times before resuming its ascent, American regulators unexpectedly pumped more jet fuel into its engine.
On Monday evening, the Treasury’s Office of the Comptroller of the Currency told national banks that they are now permitted to run independent nodes for distributed ledger networks, Cointelegraph reports.
Referring to independent node verification networks, the OCC’s interpretive letter says that banks “may use new technologies, including INVNs and related stablecoins, to perform bank-permissible functions, such as payment activities.”
Given the recent barrage of negative reports concerning the future of stablecoins, the OCC’s announcement is extremely bullish news indeed. It stressed, however, that it is concerned with cyber threats associated with the adoption of the new fiscal tech: “Banks must also be aware of potential risks when conducting INVN-related activities, including operational risks, compliance risk, and fraud. New technologies require enough technological expertise to ensure banks can manage these risks in a safe and sound manner.”
Brian Brooks, a former lawyer for the Coinbase exchange, has been the acting comptroller of the currency since May. Under his leadership, the office has given the green light to banks to be more active in crypto and no longer permits them to deny services to legal industries.
The Blockchain Association lobby group, referring to traditional international payments mechanisms, said, “The letter states that blockchains have the same status as other global financial networks, such as SWIFT, ACH, and FedWire.”
“The subject of stablecoin legal status in the US has taken on an outsized role over the past month, especially after Congresswoman Rashida Tlaib introduced a bill that seemed to outlaw any operation of a stablecoin network, including private persons running, for example, Ethereum nodes that process DAI transactions,” Cointelegraph notes.
The regulatory news is expected to intensify an already spectacular bull market that has seen bitcoin surge from $19,00 to a high of over £34,00o in the past month, providing the thrust for equally impressive price gains for many altcoins.
On hearing the news, prominent YouTuber Lark Davis tweeted, “Holy cow! This is massive for #crypto.”